A Georgia federal judge handed down a 27-year sentence - the longest of its its kind in Atlanta for a fraudulent investment scheme - to a New York man convicted of operating a Ponzi scheme that duped investors out of more than $12 million. Andrew Mackey, 62, received the sentence from United States District Judge Bill Duffey, who noted that Mackey's case was the worst of all the Ponzi scheme cases he had presided over. Earlier this summer, a federal jury had convicted Mackey and his common-law wife, Inger Jensen, on 15 counts of wire fraud, mail fraud, and conspiracy to commit wire fraud and mail fraud. For her role, Jensen received a fourteen-year sentence.
According to authorities, Mackey and Jensen were the owners of ASM Financial Funding Corporation, which was marketed to potential investors as a "wealth enhancement club." Holding themselves out to investors as experienced investment professionals, Mackey and Jensen promised investors lucrative returns of up to 20% per month by investing in several different ventures, including private and confidential offshore business deals and mortgage financing. Per the terms of the mortgage financing investment, investors were told that they could pay off a 30-year mortgage in less than five years if they paid 17%-25% of the mortgage up front. Investors were told that these ventures were guaranteed, and lured by advertisements touting the lucrative terms:
"Please note the true beauty of this program: Your total out of pocket expenses after 5 years is only $109,960 and you now own a $200,000 home. That's right! YOU FINANCED $200,000, BUT ONLY PAID BACK $109,960!"
In total, Mackey raised more than $12 million from investors. As is now known, the promised returns that seemed too good to be true were, in fact, too good to be true. Instead, the returns were the classic hallmark of a Ponzi scheme - unsustainable returns made possible not through legitimate investments, but by making Ponzi-style payments consisting of redistributed investor principal.
At his sentencing, Mackey refused to take responsibility for his crimes, instead noting that he "did not intend to steal" and that it was "hard to hear that people feel bitter." While this likely played a role in the severity of the sentence handed down by Judge Duffey, Mackey was also a convicted felon due to a prostitution-related 1987 arrest for his role as one of the "biggest pimps" in New York.
For more news and analysis of Ponzi schemes, visit Ponzitracker, a blog by Jordan Maglich, an attorney at Wiand Guerra King P.L.
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